Target Point

What Is A Rich Income?

How much would your total annual family income have to be for you to consider yourself rich? This is the question we put to respondents one year ago in our national post-election survey of registered voters and today we share the results. 

The answers extend beyond mere novelty into real world public policy and political consequences as Congress debates any number of legislative items that include a tax increase “on the rich.” And while most voters abstractly support this, it falters with a real income attached, mostly as a direct consequence of the public’s varying definitions of what it means to be rich.

So what is a rich income? The distribution of responses, plotted on a log scale below, mimics a normal bell-shaped curve.  The median response  was $250,000 – that is, half of the country gave an answer above $250K and half were below.  The most frequent response, the mode, was $100,000. (The mean is too heavily influenced by extreme values and is a correspondingly inefficient measure of the midpoint). We can also estimate a nationwide consensus at the 75th percentile, where ¾ of the country defines rich below the $500,000 mark.

A nominal search for prior work done on this topic turned up only a Gallup survey of six years ago in which they found the median “rich” income among all adults to be $122,000 (recall that our sample was registered voters).  Interestingly, Gallup also found that only 2% of the population classifies themselves as rich (similarly, a recent CBS survey found 3% that classify themselves as “upper-class”).  This matches our own finding in which the median “rich” income within actual income groups was greater than the actual income.  No matter what you make, you never think of yourself as rich.  Indeed one’s definition of a “rich” income is almost entirely dependent upon what your current income is, increasing at a steady, linear rate (see below).

Indeed, advanced analytics only reinforce the strength of the relationship between one’s own income and what they define rich to be.  Across multiple regressions using varying methods, data transformations and independent variables, the only variables that are significant predictors of a “rich” income are one’s own income, and an indicator variable for the Northeast region. 

Still despite the fact that all demographic effects are subsumed by income, we can’t help but point to a number of interesting and fun significant differences in the crosstabs.  For instance:

• GENDER: men’s median response is $250k, while women’s is 200k.
• IDEOLOGY: conservatives have a higher “rich” threshold, $250k, than liberals, $200k, and moderates line up with conservatives  with a median response of $250k.
• 2008 VOTE:  mirroring ideology, “rich” to a McCain voter means an annual income of $250k (median), while an Obama voter sets the bar at $200k. 

Finally, it’s important to put these numbers into their proper perspective: median annual household income in the United States is about $44,389 (from 2005 Census Bureau data); if we were to arbitrarily define the rich as the top 20% of household incomes the lower limit would be $88,030 a far cry from our survey’s median of $250,000.  Even the top 5% of household incomes begin at $157,176, nearly $100,000 short of our survey’s median response.

Ultimately, these findings are both interesting and meaningful.  It is a survey statistic heavy with practical political and policy consequences.  As such, it’s my hope that other pollsters begin asking this question with greater frequency, allowing for trend charting, finer subgroup analysis, and also, perhaps, making some of us more grateful for the incomes we currently enjoy. 

- Alex Lundry